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5/17/14

We keep the running score on the self-proclaimed experts at Kitco who try and fail to predict the weekly moves in gold. Last week 45.8% of them said gold would drop, with 25% saying gold would rise and 29.2% saying it would remain neutral. The result was that gold rose by 0.32% (using our trusty GLD proxy). In other words another fail, which now makes the running total 14 correct predictions over the last 36 weeks.

Monkeys. With. Dartboards.

For the record, this week the strongest pick is 44% of them saying gold will have a neutral week, with 32% of the monkeys bearish and the remaining 24% bullish. So for us in the real world, that looks fairly optimistic for the gold price.

...which I hadn't heard for donkey's years but used to play regularly at one point in my mis-spent youth. It's played by Soyoung Yoon who I'd heard about but never heard. Anyway, long story short I have a new fave player to follow and catch up on because it's a total knockout rendition of a wonderful piece.

The crowd go wild at the end (cool highfive as well). Quite right too.

As Friday morning leaves us and we all kick back, the OT stuff continues. I've highlighted the great photo work done by Tom Bartel over at Travel Past 50previously and he shared a link to this photo via his Twitter account today.

As well as taking his photography seriously (he talks equipment, exposures, shot treatments etc) he's also got a great eye, as that above demonstrates. He also kindly agreed to the photo being used at IKN, so here you are.

“We know from experience that fraudsters follow the headlines,” said Lori J. Schock, director of the SEC’s Office of Investor Education and Advocacy, which prepared the investor alert. “Given the attention that marijuana-related companies have attracted recently, we urge investors to exercise caution when looking at investments in this space. Always thoroughly research the company – and the person selling the investment – before making a decision.”

...about twenty minutes after the market opened, for reminding me just how many brain dead assholes there are running multinational mining companies. It was a pleasure and a timely reminder, I thank you kindly.

...the FARC and the ELN have today announced a unilateral cease fire. This is an important boost for the re-election campaign of President Juanma and as Colombians are anything but stupid, you can now fully expect his 'give peace a chance' call to win out over the Uribe camp's desire for more blood.

5/15/14

Tonight's SEC filing notes that Hochschild (HOC.L) took advantage of the renewed interest and price pop in Gold Resource Corp (GORO) shares to dump 2.25m of its position in the company. This leaves HOC with just over 7.2m shares of GORO. Which they'll sell eventually, of course.

The news from Rio Alto Mining (RIO.to) (RIOM) $RIOM this morning that it's hit new swathes of mineralization at La Arena outside its current reserve pit looks good to add at least a couple of years' worth of production to the mine. Or if you like and to use very round (and conservative) numbers, two years of production at 200,000 ounces a year that cost $1,000 all-in (zero extra to that, with op cash cost maybe $650/oz) to produce and then sell at $1,300/oz.

Can you do three hundred multiplied by four hundred thousand? Yeah, me too.

However, the above news from RIO.to is likely to be neutralized at market by a $10/oz downmove in bullion today and the stock price will do nothing. Ladies and gentlemen, IKN presents your pathetic market for juniors.

5/14/14

The news yesterday that Ian Ball had resigned as president of McEwen Mining (MUX) (MUX.to) just a couple of days before the company's AGM came as a surprise to the market and has been the subject of conversation between your humble scribe and several different shared mail exchanges with "people involved with mining" (let's say). Including here the head count is precisely eight, for what that's worth.

To lead up, I'll say out loud that for me at least Ball seems like an OK guy, I don't know him personally but the impression comes from other people and from watching his actions. With that said I do know he raised more than a few eyebrows in his time as president of MUX, both inside and outside the company, due to his relative youth (and his youthful appearance magnified that, being around 30 years old if memory serves but with the appearance of a 22 or 25 year old). But hey, I don't have an issue about that and from most reports, the guy is full of energy and beans and was a dynamic person in his post. How successful and efficient he was isn't something for me to opine upon.

So this post isn't really about Ball, it's more about relaying the two common threads in all the opinions offered and received about yesterday's news.

1) Near unanimous opinion is that MUX is at best fully valued to peers considering what it is and what it's got. More likely it's overvalued. It's not one I'd touch (and have said so on previous occasions, both here and in the subber's weekly).

2) Unanimous opinion is that Rob McEwen is a complete fucker to work for. Nobody in mining is surprised when a high-level officer working with or for McEwen throws in the towel, last night was no exception to that.

...that claim about cash costs constantly dropping is just another crock of shit. Splitting hair over $4? Well maybe true, it's not that big a difference but I'm only going on the company's own filings and the way in which they just cannot be bothered to tell the truth when there's a cool story to be spun. I mean, this time let's not even go to trifling things like $10.28m in net losses, working cap deficit of $39m, financial debt of ...ooh my stars that one's really big. Let's just stick with the fact that GCM can't even tell the truth in its fucking news release headlines.

TORONTO, ONTARIO--(Marketwired - May 13, 2014) - McEwen Mining Inc. (MUX)(MUX.TO) announces that it has received and accepted the resignation of Ian Ball, President. Mr. Ball is departing after 9 years with the Company in order to pursue new opportunities, however, he will continue to work with McEwen Mining to ensure an orderly transition.

Via kind reader H, this humble corner of cyberspace hears that Bear Creek Mining (BCM.v) is probably going to stay halted until Friday, as its news event is taking more time than anticipated to sort out with the Canadian authorities (IIROC). Patience required, obviously.

Round this neck of the woods there's a lot of speculation that BCM.v has reached some sort of agreement with the government of Peru on the Santa Ana project, but that's all it is right now, speculation. As the thing is halted it hardly matters until real news is known either.

"I guess Tommy Hump has to keep posting this silly, amateurish, always-wrong patter on his website, since he probably feels his job is to get people the hell out of the S&P 500 and into the gold stocks."

I'd like to draw your attention to the spectacular drill results announced by Balmoral Resources (BAR.V, C$0.99)this morning. As commented on our portfolio page, the Pretium-style bonanza intersection (1,138 g/t gold over 4.9 meters) is exciting, but the more normal, high-grade step-out holes may ultimately be more important. We've been speculating on Balmoral's shallow, high-grade Martiniere discovery extending to depth, and the company is delivering.

Great news

Yes indeed, BAR.to went up by 20% yesterday to finish at $1.04. Winning! Which is only 26c lower than the price of $1.30 that Lobito entered the stock, back in February 2011. Winning!

...is that it was prepared by Vic Wall, who may have 35 years of experience but was also the guy who bullshitted the world about Colossus at Serra Pelada and burned away hundreds of millions of dollars' worth of Canadian and US investment cash. It's also a company that's headed up (well what a coincidence) by Ari Sussman, who was the brains behind the whole Colossus promo. Hey, wonder whether Sandstorm is going to get in the mood to buy a piece of Buritica? Look, somebody's got to say it out loud so it may as well be IKN.

In fact that's another thing here, the way this chickenshit mining sector will whisper all this stuff behind people's backs and closed doors, but never have the guts to say things out loud. But that's another story for another day, today's is...

Sussman + Wall = Caveat Emptor, baby.

5/12/14

FWIW, this thing looks fully priced. Not a short either, because potential returns look thin (if at all). FVI is hitting the ceiling of organic growth with silver trading where it's trading, so either it moves up because the metal does or it fiddles around these levels indefinitely. The thing is, if silver does decide to pop back up towards $25/oz, there are going to be better ways to play the move than this one.

IKN clearly states the same message stated over the last few weeks: We are at the start of a bull market in gold, it's not going to collapse, get used to the idea. The only question you have is to decide when to get long gold and make money for yourself, now for the serious cash or later when the bullish direction is more defined and there's still plenty of profits to be made.

IKN 261 has just been sent to subscribers. FWIW here's the cover letter that went out with the edition

Good Sunday evening,

Please find attached IKN261. The main features this week include a look at our Top Pick Rio Alto (RIO.to) (RIOM) after its 1q14 financial results were published last week, a report on a meeting with Courtney Chamberlain of Minera IRL (IRL.to) (MIRL.l), thoughts on whether it might be time to cover our successful short in Gold Resource Corp (GORO) and coverage of the potentials on our shopping list, which include Reservoir Minerals (RMC.v) and now Goldquest (GQC.v).

5/11/14

Nearly forgot about this in the rush, the news is that the Kitco monkeys with dartboards actually managed to get a prediction right for a change last week, as 57.9% called gold lower and lower it went, by 0.75%. That brings the score to 14 out of the last 35 weeks correct, or 9 "strong signal" weeks correct out of 25 weeks. That's still a pisspoor record for the self-appointed experts, but just a little bit less bad than thgis time last week.

As for the week coming, the majority is 45.8% bearish, with 29.2% neutral and 25.0% bullish. So no strong signal given this week and let's see how they get on.

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